Objective - This research explores the changing mechanism in the relationship between retailers and consumers whereby consumers face higher-prices due to inflation while their earnings, and thereby their disposal income, does not simultaneously increase.

Methodology/Technique - An examination is conducted on the use of loyalty cards in the Malaysian retail sector to determine whether Asian consumers are enticed by the use of loyalty programs, which can be seen as an attempt to save money when making purchases.

Findings - The findings suggest that loyalty programs will expand in the future to include other offerings as they gain momentum and popularity. This research concludes that Malaysian consumers, like most of Southeast Asian consumers, are price adverse, and hence will take opportunities to save money when making purchases.

Novelty - The findings of this research can be generalized to the Southeast Asian region due to the similarity of consumption and national characteristics between Malaysian and Southeast Asian consumers.

Type of Paper: Empirical.

Keywords: Marketing; Strategy; Incentives; Services; Retail; Loyalty, Asia.

JEL Classification: M30. M31. M39